You don't. The program has you enter the expenses that are eligible to be used for education credits. Room and Board is not an eligible education expense for any tax credits, but is considered a Qualified
Higher Education Expense for the 529 distribution. It is not very often that the IRS requires a tax form NOT be reported, but if the 529 distribution was used for qualifying Room and Board costs, simply keep receipts for that payment and the 1099-Q from the 529 distribution with your tax file.
According to the IRS:
“Tax-Free Distributions
Generally, distributions are tax free if they aren't more
than the beneficiary's adjusted qualified education expenses for the year.
Don't report tax-free distributions (including qualifying rollovers) on your
tax return.”
Expenses taxpayers can use for the education credits are different than the expenses that can be used for 529 distributions and certain scholarships. If applied to a 529 distribution, the distribution is tax-free. If applied against a scholarship, the scholarship is considered taxable income to the student.
According to the IRS:
“Qualified Higher Education Expenses
These are expenses related to enrollment or attendance at an
eligible postsecondary school. As shown in the following list, to be qualified,
some of the expenses must be required by the school and some must be incurred
by students who are enrolled at least half-time.
The following expenses must be required for enrollment or
attendance of a designated beneficiary at an eligible postsecondary school.
Tuition and fees.
Books, supplies, and equipment.
Expenses for special needs services needed by a special
needs beneficiary must be incurred in connection with enrollment or attendance
at an eligible post-secondary school.
Expenses for room and board must be incurred by students who
are enrolled at least half-time (defined below).
The expense for room and board qualifies only to the extent
that it isn't more than the greater of the following two amounts.
The allowance for room and board, as determined by the
school, that was included in the cost of attendance (for federal financial aid
purposes) for a particular academic period and living arrangement of the
student.
The actual amount charged if the student is residing in
housing owned or operated by the school.
You may need to contact the eligible educational institution
for qualified room and board costs….”
Education credits, 529 distributions and the school loan interest deduction can be a complicated subjects. Please read IRS Pub 970 for more information.
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HERE for IRS Pub 970 Education Credits
